Energy bills will rise by £700 a year, but Sun Money may show some energy companies are trying to convince customers to pay £500 more than that.
The government has announced an increase in the price cap for Standard Variable Tariffs (SVTs), which most homes operate on, from April.
This means that the average annual bills will rise from £1277 to £1971.
But we’ve been inundated with questions from readers, and our investigation has shown that some companies legitimately advertise fixed deals that will cost you far more than staying on SVT.
Experts advise families receiving SVT to do nothing as fixed deals are often at least £200 more expensive than the new price cap.
And even if prices rise again, many of these flat rates will still make you pay more for energy.
HARRIET COOK explains what to look out for.
BEWARE of emails, text messages, or advice on websites suggesting a fix when it’s not in your best interest.
EDF Energy recently told a client, “As energy prices have changed dramatically over the past six months and continue to rise, our flat rate is the best option to protect against future price increases and can help you save in the long run.”
A buyer paying £260 per month was offered a flat rate of £715. But its SVT is capped at £358 a month and while it will go up in April, that increase won’t be as big as a fix.
EDF says prices can go up or down, and when it gives customers a quote, it says they “might” be better off staying on SVT.
SCOTTISH Power and EDF pay cash bonuses to customers who entice friends to upgrade to their expensive fixed rates.
An existing customer and a friend receive a £50 to £60 loan, but rates are at least £300 more than the new price cap.
EDF’s cheapest rate for new customers online is £2,284, while Scottish Power’s is £2,460.
Consumer advocacy campaigner Martin James said: “This is a rip-off and totally unacceptable. No energy firm should be encouraging people to repair right now.”
A spokesperson for Scottish Power said “Refer a Friend” is still open for existing customers to refer a friend.
“Because this has always been an online referral campaign, customers referred by a friend will only see rates available online.
“Currently, only our flat rates are available for online check-in.”
Cons of cashback
ENERGY Firms are still offering cashback to new customers if they sign up for high-value deals — even after The Sun exposed them in December.
Scottish Power is offering new customers £65.50 on TopCashback per fix for a year and £32 on Quidco, though its yearly fixed deal costs an average of £2,460 – £500 more than the price cap.
EDF’s Topcashback offer is £30 for customers who upgrade to a two-year dual-fuel fare, which costs £2,284 on average – £300 more than the new cap.
Its TopCashback page doesn’t explain what customers can lose by setting their rate, but instead claims that the switch means “you’ll get great prices and service.”
An EDF spokesperson said: “By providing any offer, we emphasize that customers may be better off staying with their current supplier and staying on the standard floating rate.
“However, thank you for celebrating this with us and how it might have been received.”
Hiding the cheapest deals
LEEDS surveyor Paul Robinson, 47, complained to his supplier after he seemed to have kept the cheapest deal from him.
He is set to complete a £177 per month fixed deal but is unsure of his best option as Scottish Power does not display the standard floating rate on the ‘change rates’ page on his online account.
Looking at the price cap figures, Paul figures he will be paying around £375 a month.
But the cheapest dedicated plan is Scottish Power’s fixed annual rate of £478 per month.
He said: “They have been emailing me for two months trying to get me to sign another fixed deal before mine ends on Monday.
“But on the ‘Change Rate’ page, I don’t see any mention of a standard rate. “Best Deals” cost at least £100 more than the standard variable fare.
“Standard rate and price cap information should be clearly displayed on the Edit Rates page.
A spokesman for Scottish Power said: “We are complying with Ofgem’s license terms in relation to the terms offered to customers, including the ability for customers to request SVT.”
Ofgem said suppliers should offer existing customers the same terms as new ones. It says they should give consumers the opportunity to make an informed choice between fixed tariffs and a price cap.
Should I fix it?
EREs are not flat rates cheaper than April’s new price cap of £1,971, so stay at the standard rate for now.
MoneySavingExpert says that unless the price cap changes again in October, you will have to find a fix no more than 44% above your current rate capped at £1,277 for the average family.
If the limit rises another 20% in October, as some experts predict, to over £2,300 in normal use, you will need to find a fixed deal no more than 59% more expensive than your current rate.
Retired Manchester journalist Kevin Burke, 60, spent hours waiting for a Scottish Power report after his bills suddenly doubled without warning.
He said: “We were transferred from Tonik (which went bankrupt in October 2020) to Scottish Power without our knowledge or consent and after paying £70 a month for fuel we were paying £165 then £180.
“We didn’t know what tariff we were on, and it was impossible to get through to anyone.
“Several times we were delayed for an hour, but after such a long wait, our telephone provider simply cut off the call. When we finally got through on the phone, they promised to contact us, but they never did.
“I managed to talk to someone this week and they couldn’t even tell me what rate I was on.
“Now we pay £128 a month which I believe is a variable rate that will increase from April.
“When I look online I only see fixed rates which I am sure will be much more expensive at £330 a month.
“It’s a nightmare trying to find the best option.”